Taiwan Security Monitor

Weekly Arms Update: 3/4/26

Authors: Joe O’Connor, Shikhar Chaturvedi, Danielle Kremer, and Wyeth Lindberg

This week: MND officials provide an update on the delivery of the last batch of Abrams tanks, Taiwan reportedly receives $70 million in royalty payments from F-16V development, both KMT and TPP officials speak about special defense budget proposals, and the military warns of delays to PAC-3 missile production owing to conflict in the Middle East, alongside weekly awards and solicitations.

Abrams Tank Delivery Updates

Taiwan’s M1A2T Abrams program is approaching delivery completion, with reporting confirming that 80 of 108 tanks have already arrived, including 38 delivered in December 2024 and 42 delivered in July 2025, while the final tranche of 28 is projected to be shipped in March, with arrival in April (a timeline that Taiwan Security Monitor’s July 2025 Arms Sale Backlog Update previously assessed as on schedule). Operationally, the Army has paired deliveries with a visible training and validation rhythm. Reporting notes the first tranche completed conversion training and live-fire events before transitioning toward fielded status, and the broader deployment plan aligns the tanks with Sixth Corps’ northern defense posture, centered on the 584th Brigade with a smaller allocation to the 269th Brigade, reflecting an infrastructure protection logic tied to approaches to key nodes such as Taipei Port. From a procurement perspective, the Abrams case is a useful execution benchmark inside the broader U.S.–Taiwan pipeline. Taiwan Security Monitor’s backlog tracking has flagged Abrams as one of the smoother Foreign Military Sales deliveries, and notes that completion of the final tranche would shift topline backlog optics even as higher friction programs remain constrained by contracting timelines and industrial capacity.

Taiwan Receives Royalty Payments for F-16V Jets

MND officials revealed on Saturday that as of the end of 2025, Taiwan had received approximately US$70 million (NT$2.197 billion) in royalty payments from buyers of F-16V Fighting Falcon fighter jets. A new configuration of the F-16 with advanced AESA radars, avionics, and Auto Ground Collision Avoidance System (Auto GCAS), the Taiwanese government originally worked with the United States and Egypt, who both withdrew, leaving Taiwan as the sole developer and eligible to receive rebate payments from other countries who procure F-16Vs. Per officials, Taiwan is expected to earn hundreds of millions of dollars more from rebate payments in the next five years, as global purchases of the aircraft increase.

Legislative Yuan + Special Defense Budget Updates

On Tuesday, Kuomintang (KMT) legislator Lo Ting-wei confirmed in a radio interview that at a recent dinner attended by KMT lawmakers ahead of Taichung Mayor Lu Shiow-yen’s trip to the US this week, it was mentioned that the United States had apparently demanded the KMT’s special defense budget be approximately NT$900 billion (US$28.6 billion). As we reported last week, the proposed amount of the KMT’s special budget has been highly variable, with Lo confirming this week that it could be between NT$350 billion (US$11.19 billion) and NT$810 billion (US$25.63 billion), not including the US’s suggestion of NT$900 billion. Per other sources, the KMT’s proposal is being personally managed by caucus whip Fu Kun-chi and is still set to be released by the end of this week.

Also on Tuesday, Taiwan People’s Party chairman Huang Kuo-chang held an exclusive interview with The Japan Times, stating that the TPP would agree to pass the Lai administration’s NT$1.25 trillion (US$40 billion) special budget proposal if the U.S. State Department notified a new, second package of arms sales that would be included under that budget. Huang stated that “we see no reason to write a blank check” for the government’s budget until more information on specific capability-based spending is released. Per our recent analysis of the Lai administration and TPP budget proposals, the TPP’s focus is specifically on funding sales that have already been approved, including HIMARS, Paladins, and anti-armor missiles. Prior reporting by the Financial Times and New York Times, however, indicate that the Trump administration is delaying approval of a new package of sales until after Xi and Trump meet in April.

On Monday, February 23, an unclassified Department of Defense spending plan was delivered to the U.S. Congress. This spending plan included allocating NT$26.9 billion (US$850 million) as part of a reconciliation bill passed last year. According to the Taipei Times, these funds will be used to replenish US weapons stockpiles, some of which were given to Taiwan. Additionally, this allocation serves to strengthen the alliance between Taiwan and the United States of America in accordance with the Taiwan Enhanced Resilience Act (TERA), passed in 2022. This spending is in addition to approximately US$150 million allocated in the FY26 Department of Defense Appropriations Act, passed in January, backfilling $850 million that was cut by appropriators.

Military Sources Warn of PAC-3 Delays

Military officials stated to Liberty Times today that plans to purchase a battalion worth of Patriot launchers and air defense missiles may be delayed owing to “production crowding,” as well as conflicts in Ukraine and the Middle East. Since Taiwan’s Patriot purchase is still in the planning phase, per the officials, it is possible that the United States prioritizes production of missiles to be used in the Middle East or to replenish its own stockpiles before fulfilling Taiwan’s case. To this end, LTN reported that the military would continue monitoring via military exchange channels and also urged that a special budget be passed to avoid disruptions.

Weekly Awards/Solicitations

On Thursday, several bid solicitations were made:

Also on Thursday, the Air Force Command awarded a NT$1.08 billion (US$34.23 million) contract to Air Asia Co. Ltd for the civilian outsourcing of repair and supply services at the Air Force’s Songshan Air Base. Air Asia Co. Ltd, an aircraft maintenance company now owned by Taiwan’s Aerospace Industrial Development Corporation (AIDC), was previously owned and operated covertly by the Central Intelligence Agency. The contract is to be fulfilled at the Songshan Air Base, in the Songshan district of Taipei.

On Monday, the Military Medical Bureau awarded Ningliren Medical Equipment Co., Ltd., a NT$52.75 million (US$1.66 million) contract for interventional angiography X-ray machines. The contract is to be fulfilled in the northern region of Taiwan.

On Wednesday, the Information and Communications Command solicited bids for the integrated construction of field information equipment, translation and voice systems, worth NT$558.18 million (US$17.65 million).